Energy Exchange

This morning, the House Committee on Science, Space, and Technology Subcommittee on the Environment will hold a hearing on the EPA’s methane emissions regulations, during which I will offer some insights into how and why the oil and gas industry should reduce methane emissions.

This is the first hearing about the methane issue, and while the panel is tipped in favor of industry and we don’t expect testimony to cover all the facts, here are a couple things to look out for as the discussion unfolds.

Industry representatives who are not in favor of regulations will try to make the following points:

They will say that the oil and gas supply chain isn’t the problem.

They will say that the oil and gas industry is more than capable of self-regulating.

They will say that regulation will cost a struggling industry too much, and will put American jobs at risk.

None of these statements is true.

What is true is the fact that methane poses a significant threat to our environment. Over the first 20 years following its release, methane is some 84 times more potent than CO2 in terms of the climate damage it does. While CO2 represents a continuing, long-term threat in the form of accumulated, long-lived and rising atmospheric concentrations, methane drives near-term climate effects. The result is that 25% of the global warming we are experiencing now is due to methane emissions. Read More »

This week, during a special hearing by the Joint Economic Committee of Congress, legislators gathered a cross-section of industry, policy, and environmental leaders to testify about the economic impacts of increased natural gas development. I was one of the witnesses, on behalf of Environmental Defense Fund, arguing that natural gas can only be a net winner for the economy if government acts fast to limit the impacts of new hydrocarbon development on air, water, and the global climate.

There is no question that unconventional gas development is lowering energy costs, creating new jobs, and supporting more domestic manufacturing. But it also poses real and substantial risks to public health and the environment – as well as a growing threat to the industry’s social license to operate. Continued expansion of U.S. gas development must be balanced with a strong commitment to protect against these impacts.

The congressional committee of both senators and representatives exhibited sharply differing perspectives on expanding natural gas regulation. The core question before all levels of government is whether the appropriate steps are being taken to implement and enforce the regulations necessary to minimize the risks. The answer: not yet.

The Alliance Commission on National Energy Efficiency Policy released a report today with recommendations that would put the U.S. on a path towards doubling its energy productivity by 2030. The Commission, which is chaired by U.S. Senator Mark Warner (D-Va.) and National Grid U.S. President Tom King, is a diverse coalition of energy leaders that includes representatives from energy utilities, academia, industry and environmental groups. Fred Krupp, President of Environmental Defense Fund (EDF), serves on the Commission.

The Commission found that a doubling of energy productivity (or obtaining twice as much output from the energy we use) would reduce U.S. carbon dioxide pollution down to four billion tons per year by 2030, which is 33 percent below 2005 levels. The full report is available at energy2030.org.

“The Alliance Commission’s recommendations are an innovative approach to greatly increasing our nation’s use of energy efficiency, which represents a huge – and largely untapped – opportunity,” said Fred Krupp, President of EDF. “Reducing wasted energy through efficiency is a true win-win solution that cuts harmful pollution and saves people money on their energy bills.”

The Commission’s recommendations are wide-ranging, covering multiple sectors of the economy. The recommendations include: increased stringency of energy efficiency standards for buildings and appliances, creation of financing mechanisms that bring down the cost of energy efficiency projects, reform of utility regulatory policies to enable full use of cost-effective energy efficiency and greater support for research and development.

EDF is particularly encouraged by the Commission’s recommendations related to energy efficiency finance and smart grid policies, which are a high priority for EDF. The Commission recommends that state and local governments work with utilities to create financing mechanisms, such as On-Bill Repayment (OBR) programs. OBR provides a new route to funding clean energy investments at attractive terms, relying solely on private third-party financing.

OBR programs offer an opportunity for residential and commercial utility customers to finance energy efficiency projects with loans repaid through their utility bills and financed at no additional cost to ratepayers. The Commission also recommends reforms to state utility regulatory policies that would break down barriers to utility investment in energy efficiency and enable greater use of advanced new technologies that create a smarter and cleaner electric power grid.

Though the U.S. currently lags behind other nations on energy productivity, the Commission believes there are more than $1 trillion in energy-saving opportunities with the right federal, state and local government support, and private-sector buy-in.

The Alliance Commission’s goal of doubling energy productivity by 2030 is ambitious, yet attainable, and it goes well beyond capturing the well-known, low-hanging fruit. I am confident that the solutions proposed by the Commission will drive innovation and technological advancements, which will modernize U.S. manufacturing and help us to compete globally.

On Wednesday, President Obama, speaking at Georgetown University, set out a multi-pronged approach to boosting America’s energy security. We agree that America “cannot keep going from shock to trance on the issue of energy security, rushing to propose action when gas prices rise, then hitting the snooze button when they fall again." President Obama’s goals to leverage alternative fuels, increase efficiency, and invest in smart grid technology, advanced vehicles, high speed rail, and public transit are critical steps toward a truly clean energy economy.

The core objectives of our Energy Program are to help accelerate the deployment of large-scale, clean technologies into the nation’s energy system and remake the market for efficiency and innovation. Our goal is to reduce the environmental impact of energy production, delivery, and use. Why? Because investments in clean technology will bring about the clean energy revolution we need by greatly reducing our use of dirty fuels and improving air quality and, thus, the health of millions of Americans – especially children and the elderly.

We can improve our energy independence and end the economic hardships imposed on American families by spiking energy costs while preserving our air, land, and water for future generations.

As important as the energy, environmental, and public health outcomes are, this revolution also benefits our economy and creates jobs. American workers have tremendous opportunities related to energy efficient and clean technologies, which are creating well-paying jobs and helping companies compete in the global market.

One of EDF’s main areas of focus is on smart grid technology. President Obama’s Advanced Research Projects Agency-Energy (ARPA-E) funds projects that will help modernize our antiquated electricity system. A smarter grid can adjust demand, reducing the need to build costly, new power plants. It will enable extensive new wind and solar energy to integrate into an upgraded grid so that we can rely far more on clean, renewable, home-grown energy. The result: less environmental damage, more jobs, and a more efficient, reliable, and resilient electricity system. A smart grid will also facilitate the switch to electric vehicles, making it possible to “smart charge” them at night so they can be ready the next morning for commuters who will no longer be paying for gasoline.

Another key point that the President made was on responsible development practices for natural gas. Natural gas can play a significant role in achieving our clean energy future – but it needs to be developed safely and in an environmentally sound manner. Protecting citizens’ health and the environment will require that we “get it right from the start.” That means putting rules in place to guarantee that our water and land are protected from contamination and ensuring that leakage of harmful air pollution is minimized.

The President’s call for increased transparency in the use of hydraulic fracturing chemicals is a necessity. The natural gas industry is engaged in a public perception war that it is not winning. Participating in the development of transparency within the industry is the first step necessary in attempting to rebuild public trust. A balance between creating a sustainable market for business and ensuring the health and safety of the public should not be a source of division, but instead our common ground.

While Congress is negotiating the federal budget, members would do well to recognize the essential need to make long-term investments in a 21st century clean energy economy that will reduce America’s dependence on foreign oil and put Americans back to work.

EDF commends the President for his willingness to look to the future. If we can do that, we will all benefit from a stronger economy, energy security, and a cleaner environment that protects our public health and maintains our quality of life.

About the author

Senior Director for Strategic Planning Elgie coordinates strategy and policy work and represents EDF’s programs to policymakers, supporters, and the media. Elgie brings extensive career experience in government and the private sector, with a focus on energy, natural resources, and environmental policy

About this Blog

EDF's energy experts discuss how to accelerate the transition to a clean, low-carbon energy economy.